Whilst the Sheriff’s Office believe this change in the small claims limit will have no impact on the use of the High Court Sheriff to enforce Judgments, I have serious concerns.

The small claims regime is supposed to be a simplified process designed so that parties to claims can represent themselves if they want or need to.

The most significant part of the small claims route is the no-costs rule. This means that win or lose you have to pay your own legal fees.

If you win you can claim back a very small amount of fixed costs (£80 generally), the Court fees you have paid, possibly some witness expenses/loss of earnings, and any expert fees up to a maximum limit, but you cannot claim back lawyers fees.

On a cost/benefit analysis it is therefore usually not economical to have a lawyer involved in your case all the way through. When I have a client who has a small claim, I advise them to use me on an ad hoc basis – they do the work themselves and I review it to make sure it is correct and complete.

Most clients don’t have a problem with preparing documents etc, but they struggle to understanding what exactly is required by the Court.

These are the usual directions given by the Court to the parties in a small claims case:

The claim be allocated to the small claims track.

The matter be listed for final hearing on the first available date with a time estimate of 3 hours.

Each party must deliver to every other party and to the Court Office copies of all documents upon which they intend to rely at the hearing. Such documents must be presented 14 days before the date of any final hearing. The original documents must be brought to the hearing.

No later than 14 days before the hearing of the claim each party must deliver to every other party and to the Court Office signed statements of all witnesses on whom each party intends to rely at the hearing. For the avoidance of doubt, this includes the evidence of the parties themselves and of any other witnesses whether or not the witnesses are going to come to court to give evidence.

No party may rely at the hearing on any report from an expert unless express permission has been granted by the Court beforehand. Anyone wishing to rely on any expert must write to the Court immediately on receipt of this Order to seek permission, giving an explanation why the assistance of an expert is necessary.

The Court may decide not to take into account a document (or video) or the evidence of a witness if the directions given in this Order have not been complied with.

I understand what is being asked because this is what I do day in day out, but even the term “directions” is mystifying to anyone unfamiliar with the legal system.

A “direction” is simply a command from the Court telling you to do something and by when. So the directions above translate to:

the Court will set a date for the 3 hour final hearing (ie. trial) and will let you know when it is to be;

if you have any documents you will use to support your case, you have to give a copy to both the other side and the Court at least 2 weeks before the final hearing and bring the original with you on the day;

if you or any witness wants to give evidence to support your case, you have to set out in a written document what they say and that document needs to be signed with a statement saying “I believe the content of this statement are true” and dated, and you have to give a copy to both the other side and the Court at least 2 weeks before the final hearing;

if you think you need an expert to give evidence at the hearing, you need to ask the Court to allow you to;

if you fail to give the 2 weeks advance copies of your written statements and any documents, the Court can decide to ignore that evidence at the hearing.

Imagine losing your claim because you hadn’t understood the Court “direction” to provide written statements and as a result your evidence was ignored at the final hearing. Bad enough if it is £5,000 (which is a lot of money), but so much worse if it was £15,000!

I know that the counter-argument will be that a party can use the services of a lawyer, they just won’t be able to claim back the cost from the other side if they win.

But why not? They are not in the wrong. They haven’t acted improperly so why should they lose part of what they are owed by not being able to recover their reasonable legal costs?

I can understand the reasoning for claims under £5,000 because the legal costs are disproportionate to the amount in dispute. But on claims over £5,000, the Court is able to control the amount of legal costs the losing party has to pay by deciding what amount is reasonable.

But these are not my biggest concern.

Litigants in person (ie. people representing themselves) not only generally do not know what is required of them because the Court “directions” are not easily understandable to non-lawyers, they also generally don’t understand the law – what may seem unfair may actually be the law (as a Court clerk regularly says to people, “This is a Court of Law, not a court of justice or principle”) and conversely what may seem to be an insignificant detail not worth mentioning may actually be the determining factor in a case. This is not a criticism of litigants in person, our legal system is complicated and confusing and at times utterly mystifying.

It is also true that cases which involve litigants in person take up a lot more Court time than cases where the parties have legal representation.

My primary concern is that if the small claims limit is increased and there are consequently more litigants in person, then the Court system will cease to be fit for purpose.

Cases will take longer meaning more delays. Litigants will be more dissatisfied with so much money at stake because they will feel that they have not had a fair trial simply because they did not understand what they needed to do to present their case at its best.

How long will it be before people lose faith completely in the system? And once that is lost, what will follow? I am not saying this because I have a vested interest – I very rarely deal with claims under £15,000 – but because I am genuinely concerned for people who need to seek redress through a Court system which may well end up failing them.

One Response to “Proposed changes to the small claims limit – kill or cure for the legal system?”

I can see where you are coming from but the current £5,000 level is just too low. It is quite common to have claims of £5,000+ where the claimant cannot afford the risk of costs and this will be avoided for the proposed £15,000 limit.

I suppose there wil be more of an incentive to buy in some expertise when largere figures are at stake.